On February 11, 2023, Google provided sixty (60) days notice of a Google Workspace fee increase across most licenses. For many customers, this increase is coming immediately after increased fees related to the transition from G Suite to Google Workspace.
The Google Workspace Fee Increase in Summary
The Google Workspace fee increase primarily impacts subscriptions on the “Flex Plan”, or month to month service. Flex Plan fees will increase by 20%. This includes all Google Workspace Business, Enterprise, Front Line Worker, Archived User, and Appsheet licenses. The 20% increase also impacts Google Cloud Identity Premium licenses.
Additionally, the underlying annual commitment plan fees for Google Workspace Enterprise Standard is increasing by 15%. Enterprise Standard Flex Plan licenses will be charged the 20% increase on top of the 15% increase.
Google Workspace Fee Increase Details
For all Google Workspace Business plans, the per-user fees for Flex Plan subscriptions are increasing by 20%. The per user monthly fees will change as follows:
- Business Starter: from $6 to $7.20 per user per month
- Business Standard: from $12 to $14.40 per user per month
- Business Plus: from $18 to $21.60 per user per month
For all Google Workspace Enterprise plans, the per-user fees for Flex Plan subscriptions are increasing by 20%. There is also an increase in the underlying Annual Commit pricing for Google Workspace Enterprise Standard. The per user monthly fees will change as follows:
- Enterprise Essentials – Flex Plan: from $10 to $12 per user per month
- Enterprise Starter – Flex Plan: from $10 to $12 per user per month
- Enterprise Standard – Annual Commit Plan: from $20 to $23 per user per month
- Enterprise Standard – Flex Plan: from $20 to $27.60 per user per month
- Enterprise Plus – Flex Plan: from $30 to $36 per user per month
Similar 20% increases will impact Flex Plan pricing across the following licenses:
- Google Vault
- Google Workspace Front Line Worker
- Google Workspace Archived User (all Business and Enterprise licenses)
- Cloud Identity Premium
- Google Workspace Appsheet (all Business and Premium licenses)
Impact on G Suite to Google Workspace Transition
If you are still using G Suite licensing, these changes will be in effect as of April 11, 2023 or as of your transition date if your transition occurs after this date. If you are using G Suite on an Annual Commitment Plan, Google will automatically move you to Google Workspace on your annual (or contract) renewal date. If you are using G suite on a Flex Plan, Google should provide your with 60 days notice of your automatic transition. Google began automatic (forced) transitions earlier this month and will continue until all customers are moved to Google Workspace.
As a reminder: When Google automatically transitions your service from G Suite to Google Workspace, Google will select the licensing that maintains your current feature set even if the transition will double or triple your monthly per user fees. Cumulus Global can manage your transition can discuss options to avoid or mitigate these increases.
Avoid the Fee Increase
You can avoid this fee increase by converting your service from the Flex Plan to an Annual Commitment Plan.
Flex Plan subscriptions are month-to-month. As such, you can adjust the number of licenses up or down, as needed, each month. Your invoices are in arrears and reflect any changes.
Annual Commitment Plan subscriptions, as the name implies, commit you to one year (or multiple years) of service. During your Commitment Plan term, you may added licenses at a prorated fee through the end of your term. Any added licenses increase your commitment. You cannot reduce the number licenses (you can reuse them as employees leave and new employees join your business) and you cannot cancel service until your contract renewal date.
Given the fee increase on Flex Plan subscriptions, most small businesses will NOT save money by remaining on the Flex Plan, even if your license count fluctuates over the year.
- For the Flex Plan to be less expensive, you would need to reduce your license count by more than the equivalent of 20% of your users for a full 12 months.
- Example 1:
- A seasonal business that reduces its staff for 6 months each year would need to reduce their license count by more than 40% to save money on the Flex Plan.
- Example 2:
- A business that reduces staffing for the 3 primary winter months would need to reduce their number of licenses by more than 70% to save money on the Flex Plan.
Most small businesses do not have staffing changes this large. Please evaluate your projected costs and consider switching to an Annual Commitment Plan.
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About the Author
Allen Falcon is the co-founder and CEO of Cumulus Global. Founded in 2006 to offer small businesses enterprise-grade email security and compliance using emerging cloud solutions, Allen has led the company’s growth into a managed cloud service provider with over 1,000 customers throughout North America. Having started his first business at age 12, Allen is a serial entrepreneur having started strategic IT consulting, software, and service companies. An advocate for small and midsize businesses, Allen served on the board of the former Smaller Business Association of New England, local economic development committees, and industry advisory boards.